Lawmakers Defend Biologics' 12-Year Exclusivity

WASHINGTON -- A group of 50 members of Congress from both sides of the aisle have sent President Obama a letter urging him to preserve the current 12 years of data exclusivity for companies that make brand-name biologics.

The Affordable Care Act (ACA) gives brand-name biologic companies a 12-year period during which generic companies would be barred from introducing a competing product, known as a follow-on biologic or biosimilar. Prior to the ACA, there was no clear pathway for approving biosimilars. The law directed the FDA to establish a way forward for doing so.

But Obama's economic growth and deficit reduction plan -- which was meant to act as a blueprint of sorts for Congress' deficit-reduction super committee -- included a proposal to cut the exclusivity period to seven years, claiming doing so would result in $3.5 billion in savings to Medicare and Medicaid over a decade.

Many members of Congress, including Rep. Anna Eshoo (D-Calif.) -- whose home district houses a number of companies that make biologics -- support the 12-year period, however, arguing that biologics are so complex that it would take at least that long for generic companies to produce biosimilars.

In their letter to Obama, Eshoo and the other 49 members of Congress called the pathway for biosimilars "the single most significant provision in the Affordable Care Act to lower the cost of drugs in our country." The letter went on to urge the president to keep the 12-year exclusion.

"A study by the Congressional Budget Office determined that 11.5 years is the average period of time all drugs are marketed under patent," the letter noted. "Because biologics are much more complex and expensive to bring to market than ordinary drugs, they deserve at least an equivalent to small-molecule drugs."

The lawmakers told Obama that the 12-year provision had "overwhelming bipartisan support" and passed the House Energy and Commerce Committee by a vote of 47-11; it also passed the Senate Health, Education, Labor and Pensions Committee by a vote of 16-7.

Shortening the data exclusivity protection to seven years will "undermine the legislation," and cause biotech companies to "move overseas where other regulatory environments, like the European Union, recognize the importance of fostering innovation," the lawmakers wrote.

The 12-year period is the law, they said, adding that "repeated attempts to weaken this provision, and for a time period with no legitimate basis, is [sic] unacceptable."

This is not the first time the 12-year period has been questioned. Just months before the ACA passed in March 2010, Obama and other lawmakers, including Rep. Henry Waxman (D-Calif.) were pushing for a shorter exclusivity period, something along the lines of six years, arguing that a long exclusivity period will harm patients who will have to wait years to see cheaper versions of drugs for diseases like cancer and multiple sclerosis.